Trying to better understand business start-up costs in Cambodia
Posted: Wed Apr 05, 2017 6:29 am
Was hoping to get some information from those of you with knowledge and/or experience in Cambodian business start-ups. Myself and a couple of friends have been discussing attempting to open a new backpackers hostel (not taking over another hostel, but opening a brand new one) and are wanting to do so in Siem Reap.
We've all spent a few months in the city and have chosen it for numerous reasons. We've done as much research as possible with regards to all of the different costs wed be facing in attempting to get this business off the ground. We have some business experience, but no experience operating in Cambodia.
A bunch of things have piqued my interest along the way and I'm hoping some of you can help me understand some of them.
1) why are people who are looking to sell their existing hostels asking so much money? That might seem like an odd or even naive question, but I'm curious and I'll explain why. It seems like an average ask for a 30-50 bed hostel with a 2500-4500/mth lease is 75k. After doing some research it appears if I was to go and set-up a similar hostel from scratch, obtain the lease myself, etc. that I could get the whole thing going for half that cost. Am I badly underestimating the costs involved with a new start-up? Or are these people simply looking to get paid for the infrastructure they've put in place?
2) I've put together a budget but realise, given my lack.of experience doing business in Cambodia that I'm probably missing some key costs which could effect the entire budget. Aside from rent, electricity and staff costs are there other big/significant/constant expenses I should be budgeting for?
3) are there any rules or regulations regarding expats leasing land and building? I understand that only a Khmer can own land and buildings but from my understanding a foreigner can own a business and hold land leases, is this correct?
I have other questions but we will start with these. Thanks in advance for any advice or help you can provide me with.
We've all spent a few months in the city and have chosen it for numerous reasons. We've done as much research as possible with regards to all of the different costs wed be facing in attempting to get this business off the ground. We have some business experience, but no experience operating in Cambodia.
A bunch of things have piqued my interest along the way and I'm hoping some of you can help me understand some of them.
1) why are people who are looking to sell their existing hostels asking so much money? That might seem like an odd or even naive question, but I'm curious and I'll explain why. It seems like an average ask for a 30-50 bed hostel with a 2500-4500/mth lease is 75k. After doing some research it appears if I was to go and set-up a similar hostel from scratch, obtain the lease myself, etc. that I could get the whole thing going for half that cost. Am I badly underestimating the costs involved with a new start-up? Or are these people simply looking to get paid for the infrastructure they've put in place?
2) I've put together a budget but realise, given my lack.of experience doing business in Cambodia that I'm probably missing some key costs which could effect the entire budget. Aside from rent, electricity and staff costs are there other big/significant/constant expenses I should be budgeting for?
3) are there any rules or regulations regarding expats leasing land and building? I understand that only a Khmer can own land and buildings but from my understanding a foreigner can own a business and hold land leases, is this correct?
I have other questions but we will start with these. Thanks in advance for any advice or help you can provide me with.